31,100 8% preferreds sold at $1,000.00 apiece; deal includes warrants
By Devika Patel
Knoxville, Tenn., May 15 – RLJ Entertainment Inc. completed a $31.11 million private placement of 8% convertible preferred stock on May 14, according to a press release and an 8-K filed Friday with the Securities and Exchange Commission. The deal was announced April 16, when the company said it planned to raise between $15 million and $30 million.
The company sold 31,100 preferreds at $1,000.00 per preferred. The convertible preferreds must be redeemed or converted after five years. They convert into common stock at $1.00 per share, which is a 26.58% premium to the May 13 closing share price of $0.79.
The preferreds were issued with 30% warrant coverage. The warrants are exercisable at $1.50 for five years. The strike price is an 89.87% premium to the May 13 closing price.
RLJ SPAC LLC, Peter Edwards, Morris Goldfarb and other investors bought 25,100 preferreds for $25.1 million; Wolverine Flagship Fund Trading Ltd. bought 4,000 preferreds for $4 million and Sudbury Capital Fund, LP bought 2,000 preferreds for $2 million.
Proceeds will be used for general corporate purposes.
The creator, owner and distributor of media content is based in Silver Spring, Md.
| Issuer: | RLJ Entertainment Inc.
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| Issue: | Convertible preferred stock
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| Amount: | $31.11 million
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| Shares: | 31,100
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| Price: | $1,000.00
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| Dividends: | 8%
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| Conversion price: | $1.00
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| Call: | After five years
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| Warrants: | 30% coverage
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| Warrant expiration: | Five years
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| Warrant strike price: | $1.50
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| Investors: | Wolverine Flagship Fund Trading Ltd. (for $4 million), Sudbury Capital Fund, LP (for $2 million), RLJ SPAC LLC, Peter Edwards, Morris Goldfarb
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| Announcement date: | April 16
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| Settlement date: | May 14
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| Stock symbol: | Nasdaq: RLJE
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| Stock price: | $0.79 at close May 13
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| Market capitalization: | $10.69 million
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